Mexico thwarts News Corp plan

Mexico's antitrust regulators have rejected a proposal from News Corporation to take over the local satellite television holdings of DirecTV, a move that could delay regional consolidation of the capital-intensive market.

News Corp and Venezuelan tycoon Gustavo Cisneros, the key shareholders in the region's two satellite television broadcasters, have denied there are even negotiations to combine the 3.2 million clients that Sky and DirecTV have in Latin America.

However, sources confirmed this week that News Corp had sought authorisation to take over DirecTV Mexico, but was turned down by federal regulators last month.

"We are continuing to consider all of our options regarding Latin America," said News Corp spokesman Andrew Butcher. He declined to comment on the antitrust ruling.

Mexico's Federal Competition Commission, also known as CFC, denied News Corp's takeover request on the grounds that it would become a key partner in the only two companies competing for satellite television customers.

The CFC ruling could also prevent Grupo Televisa SA, Mexico's top media conglomerate and News Corp's partner, from taking over the clientele of DirecTV Mexico in a bid to reach 1 million satellite subscribers.

"The ruling won't change the dynamic, but it would delay the consolidation of the industry," said media analyst Christopher Recouso.